Titling an inherited “beneficiary” IRA
My client’s step-dad died and the Mom took the IRA as a beneficiary IRA (don’t know why she did not make it her own. Never met her.) Mom has now died and my client, the daughter, is inheriting the beneficiary IRA from her mom. I know daughter has to continue the distribution rate that now-dead Mom had, but is there any difference in the titling of this “double inherited” IRA, as opposed to the initial inherited with “Step-dad’s name, deceased, mom, beneficiary IRA”. How will the NEW IRA custodian know how to calculate the RMD, unless they are provided with a record of the dead mom’s information, and that the daughter is a subsequent beneficiary? None of the forms that I see for beneficiary IRAs seem to cover this contingency.
Any suggestions?
Permalink Submitted by Alan Spross on Thu, 2010-10-28 23:40
The title on this IRA should include all 3 parties, eg “Donna Smith as beneficiary of Mary Jones, beneficiary of Daniel Jones”.
Donna’s RMD depends on the circumstances. If Mom passed before she was required to take RMDs because the step dad would not have reached 70.5 yet, Mom is treated as the owner for purposes of Donna getting to stretch distributions over her own life expectancy. This rule is on p 36 of Pub 590, “Death of Surviving Spouse”.